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To the consternation of consumer watchdogs, Google’s takeover of the Dutch mobile payments market for Android users is now complete, following ING’s decision to withdraw its own mobile payments app.
Over the past year, Dutch banks that previously offered mobile payments from within their own Android apps have gradually exited the market, in favour of encouraging customers to use Google Pay instead.
Although the banks point to greater efficiencies for themselves and their customers, consumer watchdogs are unhappy with the lack of choice and with Google’s handling of customer data.
In September, the Netherlands’ largest bank, ING, became the last bank in the country to cease offering mobile payments directly to customers.
With this decision, an ING mobile payments app that in 2015 was retired.
Other banks, such as ASN Bank, RegioBank and SNS Bank, withdrew from mobile payments earlier in the year.
“Do you want to continue paying contactless via your Android phone or tablet?” ASN Bank asked customers in July. “Then activate Google Pay via the ASN app.”
When asked to comment, ING referred Vixio to the Dutch Payments Association, which has taken on the role of speaking for all banks that have made the switch to Google Pay.
In a , the association said that Dutch banks can “no longer reasonably develop and offer a mobile wallet that can compete with Google Pay on Android smartphones”.
“With Google Pay, you can store and use all your payment cards (including credit cards) from all card providers on all types of Android devices,” it added. “You can also use it to pay online.”
The association pointed out that Google Pay is not mandatory for bank customers, but merely offers an additional way to make card payments.
“Without Google Pay, everyone can still easily, safely and quickly make contactless payments using their physical cards.”
Data use
The move has angered consumer rights defenders, who object to Google having privileged access to the personal and financial data of Dutch banking customers.
The Dutch Consumers' Association said it has received reports from consumers who are concerned about their privacy when making contactless payments via Google Pay.
The association said it had asked several banks what safeguards are in place to ensure that customer and financial data is kept private, and were told that the banks had agreements in place with Google for this purpose.
However, the association later found out that the banks were merely referring to Google's own terms of service and privacy policies, and not to any tailor-made agreements.
“Google does all sorts of things with that data,” said the consumer association. “Google Pay’s privacy policy states that the company will collect, analyse and use payment data for other services.
“The company can offer space for personalised ads to third parties and earn billions from it.”
Speaking with Vixio, a spokesperson for Google Netherlands said that the association’s characterisation of Google Pay’s privacy policy is not correct.
“The Consumer Association’s claims do not accurately reflect the way Google Pay works, or the protections we have in place for users,” they said.
“We do not sell user data and transaction information to third parties, including advertisers, or share it with the rest of Google for targeting ads.”
According to Google Netherlands, personal data collected by Google Pay is used only to improve product functionality, prevent fraud and to process transactions, as described in the .
Lawmakers concerned
In September, Dutch finance minister Eelco Heinen when two MPs, Six Dijkstra and Femke Zeedijk, both representing the opposition Nieuw Sociaal Contract party, raised similar concerns.
The legislators raised the issue of payments sovereignty, asking how the government will prevent the Netherlands from becoming “de facto dependent” on US technology giants for contactless payments.
Heinen said: “Dependencies on parties outside the EU are increasing in the digital domain.”
“A form of government intervention may be necessary, for example, to prevent strategic dependencies that pose a high risk of supply disruptions. However, not every dependency is problematic.”
The minister also pointed to the European Digital Markets Act (DMA), which came into force in May 2023.
The DMA stipulates that large platform service providers — the designated “gatekeepers” of the digital economy — must enable contactless payments from outside their own digital wallets.
“Consumers can still make contactless payments without using Apple Pay or Google Pay,” Heinen said.
“They can do this by using the payment cards that banks provide to their customers as standard, or via other payment methods such as iDEAL [a Netherlands’ pay-by-bank solution].”
The minister also referred to two payment initiatives that, in his view, are likely to reduce the payments dependence of EU countries on US tech companies.
The first is the digital euro and the second is the European Payments Initiative (EPI), which aims to deliver EU-wide instant payments through its Wero digital wallet app.
“Here too, the reduction of dependencies plays a role,” he said.
